WaMu, despite all their big talk about helping homeowners avoid foreclosure, is apparently too overwhelmed with a tsunami of defaulted loans to call their customers back, let alone help them stay in their homes. Meet Lori and Mark Pestana. They have a $275,000 fixed rate mortgage with WaMu as their servicer. In August 2007, the Pestanas could not make a payment on their loan. They considered dipping into their retirement savings, but WaMu’s website offered an alternative:

After reading on WaMu’s website that it would assist distressed borrowers with loan modifications, Lori Pestana called and was told they could not qualify until their payments were 50 days late. To become eligible, they stopped paying and applied for help on Oct. 9, 2007.

WaMu told them that they could expect an answer in 4 to 5 weeks. On Nov. 13, a law firm representing WaMu sent the Pestanas a letter informing them that they were in foreclosure.

The Pestanas said they tried at least twice to determine the amount they could pay to reinstate their loan, but Harmon Law either did not call back or could not give them an amount. Another time, Harmon Law refused a $12,000 payment, because it was $3,000 short of the total payoff amount, the suit said.

The Pestanas are currently scheduled to be evicted from their home later this month and are suing WaMu, seeking class-action status for all of WaMu’s Massachusetts customers. WaMu says it “fully committed to helping our customers stay in their homes” and that “foreclosure is a last resort.”

Suit blames loan servicer for pending foreclosure [Boston Globe]
(Photo: stirwise )

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